Kevin Broom

Designation as a tax-exempt, not-for-profit entity carries with it specific tax benefits. In exchange for tax exemptions, not-for-profit entities are expected to provide benefits to their communities. To evaluate whether hospitals provide community benefits (CBs) equivalent to the financial subsidies and advantages extended to them, tax liabilities and financial support were projected for all Maryland acute care hospitals between 2010 and 2012 and in the aggregate over the 3 years of this study. A comparison was then made between the provision of CBs and the financial support that governments provide to the hospitals. The results indicate that hospitals provide significantly and substantially more CBs than the material financial support they receive. Even after modeling changes in CB activities and the associated tax liabilities that may result from transitioning to taxable status, the benefits that hospitals provide to the communities they serve continue to exceed the potential gov...

Using the quality-competitive advantage-financial performance frameworks of Kroll, Wright & Heiens (1999) and Lakhal (2009), we analyze investor perceptions of how healthcare quality impacts financial performance. Using stock pricing data from U.S. financial markets, we use event study methodology to analyze how investors interpret information signals regarding the quality of care that healthcare organizations provide. Our findings are inconclusive that markets interpret higher quality healthcare will lead to a sustained competitive advantage and improved financial performance. However, our findings indicate markets may interpret that lower quality healthcare could lead to a sustained competitive disadvantage and decreased financial performance. We discuss the implications for executives, industry leaders, and policy makers.

Using the quality-competitive advantage-financial performance frameworks of Kroll, Wright & Heiens (1999) and Lakhal (2009), we analyze investor perceptions of how healthcare quality impacts financial performance. Using stock pricing data from U.S. financial markets, we use event study methodology to analyze how investors in a developed country interpret information signals the quality of care that healthcare delivery organizations provide in a competitive, market-based healthcare system. Our findings are inconclusive that markets interpret higher quality healthcare will lead to a sustained competitive advantage, and therefore improved financial performance. However, our findings are consistent that markets interpret lower quality healthcare may lead to a sustained competitive disadvantage, and therefore decreased financial performance. We discuss the implications for executives, industry leaders, and policy makers in developed healthcare markets with private-sector competition.

Analysts use DuPont analysis as a means of determining the quality of earnings. By decomposing returns on equity (ROE) into profit margin, total asset turnover, and capital structure, the DuPont analysis reveals what drives overall profitability. Firms may experience profitability as a result of the markup on services provided and/or their ability to control costs (profit margin), the efficiency with which services are rendered (total asset turnover), or as a result of how firms use debt (capital structure). This paper evaluates the drivers of profitability for a large sample of U.S. hospitals and segments the sample by important factors thought to influence profitability. The results indicate investor owned hospitals have higher profit margins, have higher efficiency, and are substantially more leveraged. Hospitals in systems are found to have higher ROE, margins, and efficiency but are associated with less leverage. In addition, a number of important and significant interactions b...

While Competency-Based Education (CBE) is the accepted approach to developing competencies for today’s health managers, programs may face a “quantity versus quality” dilemma regarding functional areas of expertise. We illustrate our process to address this dilemma by extending CBE into areas of concentration, with a stated goal of developing advanced levels of competencies within specific functional areas (“quantity, with focused quality”). Our case study demonstrates one program’s innovative approach, driven by both demand-side and supply-side stakeholder analysis, to develop a functional area competency model that addresses our program’s unique stakeholders needs (in this example, healthcare finance). We then use the model to develop a curricular infrastructure to build and assess those competencies as an elective component of the Master of Health Administration Program at Saint Louis University. Our long-term goal is to produce health executives (who need broad set of competencie...

Current and forward-looking resource constraints within the federal health system and general health market are generating questions of fiscal or economic viability of a number of programs including graduate education. This article establishes a framework for assessing economic value among graduate health-related programs within the Army Medical Department. The findings of this analysis indicated that the programs evaluated in the study generate positive economic value based on a market-based valuation of extrinsic benefits compared to extrinsic costs for conducting graduate education within each of the programs. Suggestions for future research and policy application are also discussed.